August 2009


Looking west

By John Birmingham
Looking west

Chinese President Hu Jintao, Indian Prime Minister Manmohan Singh and Kevin Rudd, 2008. © Romeo Gacad-Pool - Getty Images.

Australia and the Indian Ocean

From the moment James Cook dropped anchor at Botany Bay, taking shelter from the many squalls and great seas and hard rains that had attended his passage up the east coast of the continent, the modern Australian mind has turned to the Pacific when seeking to understand its place in the world. On the shores of that ocean lies our foundation city. It is to the east coast that most of our population clings. Beyond the vast blue horizon lies America, across another ocean the mother country, and beyond that Europa, all of them potent cultural touchstones, at first for a small, isolated colony, then for a frontier country, and eventually a nation.

In the Australian imagination, for the most part, the future arrives every day from the east, where the sun’s first rays wash over the lighthouse at Byron Bay, before flooding across the thin green band of settlement running from the jungled tip of Queensland down to Hobart’s old world waterfront. It takes many hours for the empty interior and the far west to catch up. So settled is this order that for most Australians it is a decidedly strange experience to fetch up on the west coast at the end of the day and watch the sun sinking away over water. Unless you were raised there, it seems genuinely wrong.

The convict fleets, and later migrant routes, did traverse the Indian Ocean, but the acquaintance was rough and passing. Their journeys ended and their new lives almost always began at the calm edge of the Pacific. The Indian Ocean, while not as vast, was vast enough, and surrounded on all sides save our own by the Other. By strange and possibly hostile powers, by the backwardness and savagery of Africa, and by the deadly, howling wastes of the southern oceans and the continent of ice beyond them. The prevailing winds and currents piled up great seas out there in the lower latitudes, monstrous, heaving mountain ranges of water. Our far western shores hosted but one city, the small capital of a thinly populated state that had not much cared for Federation in the first place, and which as late as 1933 voted by a huge majority to leave the Commonwealth and make its way in the British Empire as an independent nation.

London tactfully ignored the vote.

Even now, with the West’s mineral resources still helping to power the national economy through the Great Recession, it remains a frontier state and because of that a marginal one. National power, wealth and prestige remain oriented to the eastern seaboard. The nation’s reveries, its dreams and thoughts turn outwards to the world from there. When national actors – our thinkers, policy makers, business people and backpacking, budget-travelling mug punters – look north, they still frame what they see in Pacific terms. They imagine Asia as lying at the edge of our ocean, the ANZUS lake, as it is sometimes known in military and diplomatic circles.

But the forgotten ocean’s time is coming. The next century will only partly belong to the Pacific. Just as Europe’s rise made the Atlantic a setting for 500 years of maritime and naval contention, shifting power centres will draw new fleets of merchantmen and warships into play across the 68.6 million square kilometres of the Indian Ocean. Geographically dominating the south-east quarter of those open seas, rich in mineral and energy resources, and long allied globally and regionally with the declining power of the US, Australia is about to undergo the wrenching experience of having its world literally turned around.

The process is already underway, discernible in auguries as varied as Canberra’s recent $60 billion Defence Capability Plan, the Chinese government’s funding of improvements to the Korakaram Highway that links Xinjiang to Pakistan’s northern tribal areas, Malaysia’s encouragement of local fishermen to exploit deep-sea tuna stocks, and India’s investments in the Iranian port of Chah Bahar on the Gulf of Oman and in coal mines in Mozambique. The US, still the dominant power for now, is moving its pieces around the chess board, building up military facilities at Diego Garcia and Guam, having decided in late 2007 to maintain a forward presence in the western Pacific and the Indian Ocean, but not in the Atlantic. A decision Robert Kaplan, writing in Foreign Affairs earlier this year, called “a momentous shift in overall US maritime strategy”.

Already the northern reaches of the world’s third largest ocean hum with the traffic of half the world’s container ships, just under three quarters of global petroleum products, and increasingly with immense tonnages of raw materials ripped from the ground in Australia, Africa and South-East Asia, bound for the foundries of India and China. For those whose professional responsibilities require an unhealthy level of fixation on concepts such as choke points, flash points and arcs of instability, the Indian Ocean is a treasure trove, offering up such gems as the Red Sea, the Persian Gulf, the pirate-infested waters off the Horn of Africa, the Malacca and Sunda straits, and of course the all-time favourite of choke-point buffs, the Strait of Hormuz, through which passes 40% of the world’s seaborne oil, including a third of China’s supply, 70%  of Japan’s and 90% of India’s.

Fifty-four kilometres across at its narrowest point, bordered by Iran on its northern shore, and a short distance from the huge Chinese-built naval facility at Gwadar, in southern Pakistan, the Strait of Hormuz is the sort of place that keeps admirals awake at night. Iranian threats to close the narrow passage and trash the international oil market – a frequent tactic in confrontations with the US – are noted in capitals far from Washington. In September 2008, the Iranian president, Mahmoud Ahmadinejad, found his visit to Beijing unexpectedly cut short with no reason offered. The most likely explanation is that Ahmadinejad was treated thus to remind him that America was not the only country whose vital interests were being damaged by the commander of the Revolutionary Guard’s threat to “to take control of the Persian Gulf and the Strait of Hormuz” and thereby drive up the price of oil.

As Chinese and Indian resource demands grow over the coming decades, irrespective of the present difficulties in the world economy, the Indian Ocean will feature on more and more maps in briefing rooms, commercial centres and naval headquarters throughout the world. Most of those maps will not be centred on the subcontinent, or even on Diego Garcia, America’s strategically placed military base a thousand miles to the south of India. The centre of these maps will be drawn another thousand kilometres or so to the south-east, in the heart of the Mid-Indian Basin, a null space, where not a single tiny island peaks above the waves. From that perspective anyone viewing the new map of the world can see just how much lies around this vast expanse of open water, encompassing seven time zones, half the world’s latitudes, and most of the clashing civilisations famously described by the late American political scientist Samuel Huntington.

Whereas Australia’s first two centuries were characterised by Geoffrey Blainey’s tyranny of distance, her future is beholden to sometimes uncomfortable proximities – political and military closeness to the declining hegemony of the US, and strategic proximity to the vast theatre in which the next Great Powers will contend. Until recently, only one of those contenders, China, exercised the local imagination. So wealthy did we grow on her seemingly insatiable demand for raw materials during the boom, that some wilder commentators, such as Paul Sheehan, even posited a future in which Canberra would ally itself with Beijing in the same way it had once hidden behind the skirts of London and later Washington.

It is probably fitting, then, that our first real political engagement with India –  China’s closest competitor, and a much more likely strategic partner for us in the future – was occasioned by thousands of Indian students protesting in Melbourne against a series of violent assaults on some of their number, and against the perceived indifference of the local authorities to their plight. Fitting, because that indifference could easily characterise the traditional attitude of Australian governments to New Delhi, and because it is the very generation of Indians now studying in Australia who will build their country into a superpower and who will look to other democracies for support in the inevitable contest with China.

A contest that started long ago.

The droll response of some Indians to Western hopes that they might contain Chinese ambitions in the future, is that they have been containing them since the invasion of Tibet. The two countries fought a small war in 1962 and many border disputes continue. Writing in Asian Security in May this year, Iskander Rehman argued that China, which simply cannot countenance the emergence of a rival power in Asia, has been determinedly working to “minimize India’s regional and global standing”, blackballing it from pan-Asian organisations, even those that include nations from Central or Eastern Asia. During 2005, for instance, “Chinese diplomats had visited Southeast Asian countries lobbying (in vain) to prevent India from joining the East Asia Summit,” a blocking tactic which foundered on the desire of ASEAN nations like Indonesia and Malaysia to include India as a counterweight to an increasingly powerful and demanding communist regime.

Away from the diplomatic cocktail circuit, however, in the world of real things, where what matters is brute strength and a nation’s ability to project national power, the two developing giants have been actively manoeuvring to check and contain each other, a process Rehman describes as being characterised by strong undercurrents of “mistrust”, “uncertainty” and “mutual suspicion”. In this realm there exists “another facet of their relations, seldom evoked by either country’s officials, a subterranean level of policymaking where hyper-realist concepts that some Western scholars may now view as archaic, such as sovereignty, deterrence, containment and the balancing of power through buffer states, reveal their enduring significance”.

The Indian navy, already one of the largest in the world, is slated to expand from 155 ships to well over 300, including three aircraft-carrier battle groups and a flotilla of nuclear-powered submarines. Indian policymakers mangle their worry beads when they look west to the Pakistani port of Gwadar, funded and built by China, and east to the Bay of Bengal, where Beijing has all but encircled them with yet more bases and surveillance posts. The Chinese for their part obsess over the Strait of Malacca, through which 80% of its oil supplies are presently shipped. On this, Robert Kaplan quotes Zhang Ming, a Chinese naval analyst, who warns that the 244 islands of India’s Andaman and Nicobar archipelago could serve to block the western entrance to the Strait of Malacca like a “metal chain”. For Zhang, India is possibly China’s most realistic strategic adversary. Once New Delhi commands the Indian Ocean, he predicts, “it will not be satisfied with its position and will continuously seek to extend its influence.”

This is the context in which China’s worldwide race for resource security must be placed. It is not just Australian iron-ore companies that China has been trying and sometimes failing to buy up. The US recently blocked Huawei Technologies from taking over 3Com, a manufacturer of high-tech network systems. Other nations have been less sniffy about accepting billions of dollars of Beijing’s money. The Brazilian oil firm Petrobas is borrowing US$10 billion to fund deep-sea drilling operations, while Canada’s Addax Petroleum, which has extensive interest in Iraq, is under offer from Sinopec for over US$7 billion. African dictators, Middle Eastern oligarchs, the ramshackle Pakistani government – all have benefited from hundreds of billions of dollars worth of Chinese investment in diversifying their resource base.

In the eye of such a storm, the arrest of Rio Tinto’s Stern Hu and three other locally employed Chinese is but a dust mote. The mining giant’s second-ranked manager in the Middle Kingdom may be headline news here, but that doesn’t mean much. His arrest and detention will undoubtedly hurt China as Western multinational firms react negatively to the ham-fisted thuggery, as the financial services minister, Chris Bowen, pointed out on 12 July. China, however, did not suddenly become a totalitarian regime when the state security apparatus decided to throw a bag over Hu and his colleagues. A bit of extra danger money might be factored into the packages of Western executives working there in future, but such executives are not likely to abandon the field to their competitors.

Whatever becomes of Hu, he does help us understand, just a little perhaps, the often-inscrutable thinking of Rudd on matters of China policy. A famous Sinophile, fluent in Mandarin, once excoriated by a desperate Opposition as a Manchurian Candidate, the prime minister has proven himself altogether more difficult for the Chinese government to handle than his staunchly Anglophile and conservative predecessor. Howard indulged himself in none of the special-relationship psychodrama that marked the early years of the Hawke government, preferring to keep his focus on purely commercial interests – a myopia appreciated by the equally hard-headed CCP. Rudd, on the other hand, who seemed to promise so much, has confused and disappointed the Chinese leadership, first by failing to deliver them much-coveted prizes such as Rio Tinto, then by delivering instead a massive Australian military build-up, which was framed primarily as a response to China’s own military programs. Not to Indonesia. Certainly not to India. But to China, which was forecast by the Defence White Paper to become Asia’s strongest military power in the future. “The pace, scope and structure of China’s military modernisation have the potential to give its neighbours cause for concern if not carefully explained,” said the White Paper.

To hedge against this, Rudd committed his government to doubling the submarine fleet, with twelve next-generation hunter-killer subs. He has also committed to more surface assets, including littoral-assault ships that could readily convert to aircraft carriers; 100 joint-strike fighters have also been ordered. The discontinuity with established defence philosophy can be seen in the reaction of the established defence commentariat, which, after a slow burn and a lot of rumbling, quickly went ballistic. “Highly unsatisfactory,” thundered Emeritus Professor Paul Dibb, of the Australian National University. “I find it remarkable that we are contemplating war with a major power. Do we actually think that if China attacked us and we defeated them that Beijing would let the matter rest at that?”

A curious response, which does raise the question of what the role of the defence forces should be when attacked, if not to defeat the aggressor.

Professor Hugh White, the head of the Strategic and Defence Studies Centre at ANU, was more sanguine, having declared in 2008 that a major war in the region was not unthinkable, “for the simple reason that some of the major powers in Asia are clearly building their forces with exactly that possibility in mind”. In response to Rudd’s White Paper, he was less emphatically upset than his colleague Professor Dibb, but remained vexed by the odd and muddled language used, and what he saw as “a strange take on the relationship between economic power and political power”.

It fell to the former prime minister, Paul Keating, however, to launch the most spirited counter-attack on behalf of the Chinese, with whom he has reportedly done considerable business since being evicted from office. Rudd was simply too defensive in his dealings with Beijing, according to Keating, who declared China’s coming economic ascendancy “altogether positive”, with huge opportunities for Australia. “That is why, I believe, we must always be outgoing,” said Keating. “We must be alert, dextrous and positive: never defensive.”

It was a bravura performance by the old rhetorical magician, sweeping the audience along in the wake of his bright and shining vision – while never once admitting that such visions occasionally founder on brute reality, as they did when his secretly negotiated security pact with Suharto’s Indonesia was later torn up, quite literally, by President BJ Habibie in response to Australia’s role in liberating East Timor. (Incidentally, East Timor involved a comparatively simple, low-intensity military operation, yet stretched the ADF to the edge of failure in some regards, thanks partly to chronic underfunding of the defence forces by Keating as treasurer and PM, and partly to a crippling structure inherited from Paul Dibb’s earlier defence review. The army and navy struggled to project overwhelming power into the very archipelago through which Dibb insists any threat to Australia must come.)

Rudd, for his part, remains hard to read. Having told Time magazine that he hopes to “make a difference” in China’s relations with the world, he found himself in early July unable to make even a token difference in China’s relations with Australia when they hit the rocky shoals of the Rio Tinto arrests. The revelation that the investigations leading to Stern Hu’s detention were personally approved by President Hu Jintao came at the same time as news of a realignment within the regime, with the spies of the Ministry of State Security and the Public Security Bureau being handed much greater responsibility for dealing with China’s enormous, and increasingly important, overseas investments.

How “alert, dextrous and positive” they prove to be as financial asset managers remains to be seen, but they will doubtless employ world’s best practice when it comes to managing the undercurrents of  mistrust, uncertainty and mutual suspicion running through Iskander Rehman’s “subterranean level of policymaking”.

While Hu’s arrest was portrayed in Australia as an outcome of Chinalco’s failed bid for Rio Tinto, it was both more and less than that. Stern Hu and his colleagues were simply unlucky to get caught up in something much more significant than a business deal that went sour for one of the partners. Their fate was to be swept up as tiny leaves before a great storm front, a hundred-year storm that will remake the whole world, but nowhere as drastically as the undiscovered hemisphere centred on a bare patch of the Indian Ocean, surrounded by rising hyperpowers, and the spoils over which they will contend.

John Birmingham

John Birmingham is an author, a columnist and a journalist. His books include He Died With a Felafel in His Hand and Leviathan: The Unauthorised Biography of Sydney.


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